GetGlue shears its Viggle relationship
Second screen apps start-up Viggle's plans to take over older and bigger second screen player GetGlue for $25 million and some stock has become, well, unglued.
The decision was apparently mutual, with the first reports of the split coming when GetGlue founder Alex Iskold put out a message that "we've decided GetGlue will not be merging with Viggle" even though the "two companies remain friendly and think highly of each other."
That was a precursor to a mutual admiration announcement that grew when Viggle CEO Robert Sillerman added his own statement wishing "GetGlue and Alex all the best."
It's unclear what caused the split, although both companies publicly touted their benefits.
GetGlue, wrote Iskold, has "a strong product and partnership pipeline for 2013" and is a "widely recognized brand and a product that is loved by millions of people."
Those people, he said, include 3.5 million television fans and 75 major networks and studios "routinely promoting their content to our fans."
Viggle, which has a relationship with DirecTV (Nasdaq: DTV), is just as popular and powerful, added Sillerman.
"We have seen impressive growth in our business," he wrote in his statement.
Still, with about 1.62 million members watching television shows in the hopes of getting rewards, Viggle is smaller and younger than GetGlue. This disparity, in fact, led CNET to theorize that Viggle could be a little short of the bucks needed to make the acquisition.
"The company said in November that it was raising up to $60 million in convertible debt financing to fund the GetGlue buy, but that doesn't appear to have taken place," the CNET story reported. "Instead, on January 10, Viggle's board approved an increase to the company's line of credit to $20 million from $15 million, according to documents filed with the Securities and Exchange Commission."
Some of that money, no doubt, will be doled out in a $500,000 break-up fee that GetGlue is getting.
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